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Wednesday, August 02, 2017

Older women are poorer

More than a million women in their early 60s have become poorer as a result of delays to their state pensions, according to a new study.

Researchers at the Institute for Fiscal Studies (IFS) found that, on average, women aged between 60 and 62 were now £32 a week worse off. As a result poverty rates among that group have risen sharply, it said.

But the IFS also said the savings, and extra tax from working women, meant the state was £5.1bn a year better off. The campaign group Waspi (Women Against State Pension Age Inequality) said the research was shocking.

"Once again, this shows that the government has implemented state pension age (SPA) reforms without adequately considering the full impact of these changes on the women affected," said Waspi director, Jane Cowley.

Caroline Abrahams, at the charity Age UK, said the IFS figures were "extremely worrying".

The IFS study showed that many women in the age group already affected by the pension change have continued working. But the effect of waiting longer for their state pension has, on average, outweighed the gains made by those who have continued to earn a salary. Thus the female 60-62 age group as a whole was earning an extra £2.5bn a year, an average of £44 per week. But the same group has also lost £4.2bn in pension and other benefits per year, or £74 per week.

Jonathan Cribb, of the IFS, said the new policy was clearly putting pressure on the budgets of some households. "The increased state pension age is boosting employment - and therefore earnings - of affected women but this is only partially offsetting reduced incomes from state pensions and other benefits," he said.

The IFS calculated that absolute poverty rates - measured after housing costs - had increased from 15% of women aged between 60 and 62 to 21% of them.